RBC Capital has trimmed its price target on Invesco to $33.00 from $35.00, while leaving its rating on the asset manager at Outperform. The change comes after a post-quarter reassessment of the firm’s expense outlook and related modeling assumptions.
Invesco shares are trading at $27.16 and have returned 46.65% over the past year, despite recent volatility in the stock. The target reduction reflects a narrower adjustment rather than a shift in the analysts overall view of the business.
RBC analyst Kenneth Lee pointed to Invescos 2026 expense outlook as a central consideration behind the change, but indicated the impact on the investment case is modest. As part of the update, RBC lowered its expense assumptions and revised estimates to reflect an updated net service and distribution ratio. The firm also reduced prior assumptions about future share buybacks.
Those modeling changes were made against a backdrop of mixed fourth-quarter financials. Invesco reported fourth-quarter 2025 earnings per share of $0.62, ahead of an expected $0.57, while quarterly revenue came in at $1.23 billion versus forecasts of $1.24 billion. The combination produced a positive earnings surprise alongside a slight revenue shortfall for the period.
RBC maintained its constructive medium-term view of the company. The firm continues to expect improved organic growth and sees room for incremental operating leverage, which could lift margins to roughly 37%-38% in 2026 and 2027 under its scenario assumptions.
Additional data points cited alongside RBCs note include a 3.09% dividend yield and a record of 19 consecutive years of dividend payments. The analyst highlighted ongoing progress in reducing leverage on the balance sheet as a supportive factor for the maintained Outperform rating, even with the lower target.
Third-party valuation metrics referenced in the note indicate Invesco appears slightly undervalued on a Fair Value basis, and four analysts have recently revised their earnings estimates upward for the upcoming period. Although the company was not profitable over the last twelve months, analysts referenced in the data set project that Invesco will return to profitability this year.
Context and next steps
RBCs target reduction is driven primarily by updated expense and buyback assumptions rather than a wholesale change to the firms growth or margin outlook. Investors will likely watch how expense trends develop through 2026 and whether operating leverage materializes to deliver the margin expansion RBC envisions.
At the same time, the recent earnings beat on EPS and the modest revenue miss underscore a mixed performance that market participants may weigh as they reassess forecasts and positioning.
Key metrics reiterated in the note
- New RBC price target: $33.00 (down from $35.00) with Outperform rating maintained
- Current share price cited: $27.16; one-year return: 46.65%
- Dividend yield: 3.09%; dividends paid for 19 consecutive years
- Q4 2025 EPS: $0.62 vs. expected $0.57; Q4 2025 revenue: $1.23 billion vs. $1.24 billion expected